Zanaga Iron Ore Share Discussion Threads

[pugugly] 15/8/2023 15:15

T101:_ Your chickens coming home to roost - but it is a very red day virtually everywhere.

Cash is King.

[terminator101] 15/8/2023 14:34

How's that "shard are incentived" waffle looking today ?

[volsung] 15/8/2023 13:05

Not buy finest purchase so far.
Anyway have to give it time I suppose

[volsung] 28/7/2023 10:47

Looks interesting
Bought a few this morning

[moonshine3] 16/7/2023 21:29

Kimchi aka magnificientNonce, has been impaled here. This loser keeps moving from one disaster to the next.

[extrader] 12/7/2023 09:29

There's been a lot of criticism re the Shard facility, some of it perhaps warranted, others maybe showing a lack of familiarity re the detail.

If you read the November 'Acquisition' RNS, you'll see

.."· Funding agreement

o In order to fund the Project's continuing work programme and budget, as well as the working capital requirements of ZIOC, until 31 December 2023, Glencore Projects has agreed to amend the terms of the Loan Agreement as follows:

§ increase in loan quantum from US$1.2 million to US$1.8 million;

§ extension of loan repayment date to 31 December 2023.

§ Jumelles may utilise up to US$200,000 of the loan facility to advance loans to ZIOC to fund its working capital..."

From which it's reasonable to deduce that (a) $ 600,000 was all the extra funding foreseen as needed to see ZIOC through to (b) extended 31 Dec 2023.

It also suggests that the new Shard facility (set up just before YE results publication) was much more likely driven by need to avoid a 'going concern' (12 month outlook) qualification, rather than any pressing need for funds.

We know that the previous Shard facility , for fewer shares, was drawn down over 3 years.

As to why not just have GLEN increase (again) the amount and term of the existing loan facility, consider the optics : had it done so, that would show that 'new ZIOC' was still in GLEN's pocket, rather undermining the necessary legal/commercial fiction - and purpose- of the 'acquisition' in the first place.

Consistent with this interpretation, the GLEN Board members couldn't 'get all over this', because they are 2 x (minority) NEDs...

Note too that the original Loan facility was agreed two months earlier in Sept 2022,(ie pre 'Acquisition) when ZIOC's cash balance was down to $ 0.1m, with remaining Shard facility expected to suffice to Q3 2023 *,

* incidentally, showing ZIOC's extreme reluctance to dilute unnecessarily

and that

.."Work programme and budget for 2022, and $1.2m Jumelles Ltd working capital loan facility, agreed with Glencore Projects Pty Ltd ("Glencore"), a subsidiary of Glencore plc

o Loan provides full financing for the Zanaga Project budget until 30 June 2023.."

Paradoxically, you could argue that (1) GLEN's apparent 'going along' with the (dilutive) Shard facility together with (2) the apparent lack of immediate funding need suggest that the Shard facility requirement is indeed 'technical'.....and may, rpt may also suggest that 'the deal' may indeed be closer than some suppose :

- loan terms agreed in Sept 2022 are tweaked (amount/tenor) at time of Acquisition(Nov 2022), when 'deal-enabling' re-structure takes place; independent newCo ZIOC takes out new Shard facility, for which it seemingly has no pressing need.

It's at least conceivable that we've seen this succession of short-term measures because management expect/expected to be 'overtaken by events'.

I normally leave this sort of dot-joining to MM....where is he, BTW? When last heard of, he said he had 'a long list of potential share price kickers I'm watching for. Some are actually in play.'

More stuff from flightradar24?

As ever, just IMO (atm); NAI, DYOR, etc etc

GLA

[extrader] 12/7/2023 08:59

“It's tough to make predictions, especially about the future.” ― Yogi Berra

We've been (not quite) here before.
If the stars align, this could all be over by year end, IMO. Then again....

Even a stopped clock is right twice a day.

NAI, DYOR etc etc

[greenelf] 12/7/2023 07:55

Anything from one week to 10 years..

[kimchi1] 12/7/2023 07:43

Extrader - what approx timeframe are you looking at for a decent return on your investment here ? Thanks.

[extrader] 11/7/2023 17:12

Fair enough.
The world would be pretty boring if we all felt the same way!

ATB

[pugugly] 11/7/2023 17:03

Ex If you are holding will keep fingers crossed for you. However as said above used to hold but (imo) not tempted in current global slow down to get in at this valuation -

[extrader] 11/7/2023 16:42

They appear to have enough cash for the next few months at least

.."The Company's cash balance at 27 June 2023 was US$530,000, with US$1,250,000 of drawn debt and incurred interest under the Glencore Facility and the Company continues with its prudent cash management. The proceeds received by the Company from SMC pursuant to the ESA will be applied to general working capital, including the provision of further contributions to the Zanaga Iron Ore Project's operations..."

ZIOC ore quality is needed for 'green ore' which will be in demand not only in China (emissions/pollution is a real domestic politics concern) but also elsewhere.

'Green' isn't just about feel-good, there 's a $$$ and cents side, too :

hxxps://www.agbi.com/article/india-expects-eu-carbon-tax-to-hit-steel-and-iron-exports/

.."In April, the EU approved the world’s first plan to impose a levy on high-carbon goods imports from 2026, aiming to become a net zero emitter of greenhouse gases by 2050, some 20 years earlier than India’s target.

Reporting of carbon content in exports to the EU would be required from October 1, 2023. The main goods affected would be steel , cement, aluminium, fertilisers, electricity and hydrogen...."

We've got BRICS summit coming up next month...and COP28in December (in the UAE).

With a fair wind, we might - rpt, might- have some developments by then.

IMO

[pugugly] 11/7/2023 16:28

Extrader:- You make a fair point but it is now a falling market - World appears to be falling into recession - in particular Chinese construction a world leader in the consumption of structural steel - so maybe just maybe Shard will be forced to accept lover prices if ZIOC call for cash.

[chesty1] 11/7/2023 14:51

Nobody talking & watching it fall now.

[extrader] 05/7/2023 02:16

Hi Terminator

You’re wrong.

An overhang only arises where there's a holder who's a motivated seller.

AIUI, ZIOC has no immediate cash needs and the Shard arrangement was 'technical', to satisfy the 12 month 'going concern ' outlook, which looks beyond the 31/12/2023 end-date of the GLEN facility.

So there won't/shouldn't be any likelihood of Shard rushing to place shares, killing off any rise. In fact, because their ££ comes from their 5% commission chargeable on a 3-month 'lookback' basis, they're actually incentivised to slow down sales in a rising market.

Companies House show them as a boutique financial services business, catering to family offices, HighNet Worth individuals, Golden Visa applicants, etc. They look after Client Assets of £ 1.2Bn and have assets under management AUM of US$ 2.14 Bn. So they're unlikely to 'front run' any customer purchases.



Their website hxxps://www.shardcapitalstockbrokers.com/ isn't overly informative or kept up to date, but amongst its palette of products is

ALTERNATIVE RESOURCE CAPITAL

“Alternative Resource Capital is a natural-resources focused financial advisor and corporate broker.

ARC leverages its in-house specialist expertise as it seeks to become a leading advisory firm, providing corporate broking, research, institutional sales and corporate finance services.

Its team, which has many years’ experience, is well known in the sector, having successfully executed a variety of transactions for both public and private mining companies, across a wide range of commodities……”

It's not inconceivable that Shard - which doesn't have to pay for the Shares at time of subscription - will take ZIOC's advice (maybe even instruction?) on when to place, based on ZIOC's actual cash requirements and other considerations, including the share price. Who knows - ZIOC may even have a say in who gets sent an application....?

Look how long it took to eke out the last facility - 3 YEARS -and Elphick's repeated invocation of 'minimize shareholder dilution' :

-6/2020 3x 7m tranches announced (again, just before 2019 results and 'going concern' test;

-1/2021 7m placed

-5/2021 7m placed

-7/2022 4m placed, 3m left

-6/2023 3 x 12m tranches

AT missed a trick in not pointing this out in the release, IMO.


ATB

[terminator101] 04/7/2023 22:50

It's not that difficult to understand. They sell the shares for whatever they can get for them and the company gets 95% and they get 5% of the proceeds. It's zero risk easy money.

[extrader] 04/7/2023 12:39

It's explained in the RNS :

.."13.30 pence (being ZIOC's mid-market closing share price on Thursday 29 June 2023).."

There's some more clarification over on the lse board, FYI.

HTH

[xcap1] 04/7/2023 11:58

One wonders why 13.2p has been used for 'illustrative'purposes and not 10p or 15pI would hope that's what they are looking to achieve and have some positive news flow coming thru in the next few weeks/months to support these price levels in order to achieve the quantum raise they are hoping for

[xcap1] 04/7/2023 11:13

Don't really see what all the fuss is about. Profit taking was/is a function of the market, absolutely well done to those who made money and took profits. Capital raise comes as no surprise surely. In order to progress and update the DFS and engineering and infrastructure mine plan will cost a significant amount of money (hence the need to raise) but early indications as stated in the AR is a potential 20% cost saving which will see a much more robust and lower capex figure Nothing has changed in the vision of ultimately bringing this massive asset to produce 12 18 and possibly 30 tpa long life mine Yes the additional shares will have to be absorbed by the markets but so would a placing with flippers , this is meant to handled in a more orderly fashion.

[extrader] 04/7/2023 11:12

The Shard subscription arrangement isn't a death spiral, where the promotor has an incentive to drive the price down, to maximise the shares he gets on conversion.

It's a finite number of shares, with phased release; clawback/cancellation rights; and Shard is incentivised to max the sale price, because it's paid its 5% commission on a 'lookback' basis at the END of the 3-month subscription period.

Shoulda gone to Specsavers- they do hearing tests, too!

[terminator101] 04/7/2023 10:46

"Resembles death spiral" Hilarious. If it looks like a duck, swims like a duck and quacks like a duck it's probably a duck.

[extrader] 04/7/2023 09:28

Well, I'm wary of 'confirmation bias' but there's a lot of work been done over on lse that suggests that 'maybe, just maybe' this time it's different.

hxxps://www.adportsgroup.com/en/news-and-media/2023/06/20/adpg-signs-a-30-year-extendable-concession-agreement-with-republic-of-the-congo

for example.

NAI, DYOR etc etc